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Does Printing charges attracks TDS

bhanuprasad (SR EXECUTIVE OFFICER) (49 Points)

15 November 2010

Hi,

Any body can clarify me, does printing charges wil attrack TDS if single bill amount exceeds Rs.50000

Please do need ful

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5 Replies

Aditya Maheshwari (CA in Practice) (35867 Points)
Replied 15 November 2010

TDS not deductible on manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from a person, other than such customer.

If above condition not satisfied then TDS deductible u/s 194C.

CA Shiv (Business Controller) (2987 Points)
Replied 15 November 2010

I think yes.. it is needed to dedcut under 194c.

And also if its not a big amount than forget it.

Ashish Sharma (Service) (1028 Points)
Replied 16 November 2010

I think Printing charges comes under Job work process so it liable to deduct TDS.

The provisions of Section 194C would apply in case of supply of any article or thing as per prescribed specifications only if it is not a contract for sale. [Circular No.13/2006 dt.13-12-2006].

CIRCULAR

INCOME-TAX ACT

Section 194C of the Income-tax Act, 1961 - Deduction of tax at source - Payments to contractors and sub-contractors - Applicability of TDS provisions of section 194C on Contract for Fabrication of Article or Thing as per Specifications given by the Assessee - Contradiction between two Circulars of CBDT - Resolution thereof

CIRCULAR NO. 13/2006, DATED 13-12-2006

1. Representations have been received in the Board seeking clarification on the applicability of section 194C on such transactions, where the assessee has outsourced certain work relating to fabrication or manufacturing of article or thing in accordance with the specifications given by the assessee. Circular No. 681, dated 8-3-1994 of the Board clarifies in para 7(vi) that the provisions of section 194C would not apply to contracts for sale of goods and further clarifies that where the property in the article or thing so fabricated passes from the fabricator-contractor to the assessee only after such article or thing is delivered to the assessee, such contract would be a contract for sale and so outside the purview of section 194C. However, in reply to question No. 15 in Circular No. 715, dated 8-8-1995 on the subject of applicability of section 194C, in respect of contract for supply printed material as per prescribed specifications, it has been said that such contracts would also be covered under section 194C. It has been represented that the views expressed in these two circulars, to the extent as pointed out above, are in contradiction to each other.

2. The matter has been examined by the Board and it is considered that exclusive reliance on Question/Answer No. 15 of Circular No. 715, without taking into account the principles laid down in Circular No. 681 is not justified. Before taking a decision on the applicability of TDS under section 194C on a contract, it would have to be examined whether the contract in question is a ‘contract for work’ or a ‘contract for sale’ and TDS shall be applicable only where it is a ‘contract for work’.

3. It is, therefore, clarified that the provisions of section 194C would apply in respect of a contract for supply of any article or thing as per prescribed specifications only if it is a contract for work and not a contract for sale as per the principles in this regard laid down in para 7(vi) of Circular No. 681, dated 8-3-1994.